Introduction
Insurance has gained popularity over the years due to its appealing characteristics. People buy insurance covers to protect their lives and properties against damages caused by accidents. Insurance policies are designed to manage finances and risks when an accident occurs. With this factor in mind, individuals are encouraged to apply for different types of insurance covers. Policy covers contain different terms and conditions, therefore it is good to know what makes insurance go up.
History
Understanding what affects premium rates of different policies is an important step every individual should take. Insurance companies use age to determine the premium rates of various insurance policies. Different types of insurance go up as people get older. Elderly people and teenagers are charged higher premium rates because of various reasons. The main reason policy providers charge high premium rates is because elderly policy holders and teens are careless drivers. Gender and marital status are common factors used to determine premium rates for auto policy covers. Women are considered to be safe drivers than men. This means the rate of premiums charged for women is cheap compared to that of men. Insurance go up if the policy holder is insured as a single person. Married people pay low premium rates than the rates paid by a single person with a similar driving record.
Features
Service providers in different regions use other aspects like geography to calculate premium rates. The residential place of a policy holder affects cost of premiums. Individuals living in places with less traffic spend little money on insurance. People driving in residential areas with high congested areas pay high amounts of cash for their insurance policy. Individuals living in neighborhoods with high rates of vehicle theft should be prepared to have their insurance go up.
Insurance go up if the insured is found with traffic violations. There are many types of traffic violations committed by drivers. Some of the traffic violations that affect the cost of auto insurance include speeding tickets, reckless driving and driving under the influence. Many insurance companies penalize clients found guilty of traffic violations for some years. However, insurance providers charge low premiums once the driving records of an individual improves.
Expensive vehicles have higher premium rates due to their costly value. Expensive automobiles have high chances of being stolen or vandalized. This is the main reason why people are charged high premium rates for luxurious automobiles. Insurance go up due to other factors like accident claims. Policy providers charge low premium rates for people with clean records. People with many tickets and accident records do not have a chance of paying low premium rates.
Tips and comments
Insurance companies use credit ratings to determine the amount of money individuals pay for policy covers. People with poor credit ratings are charged high premiums. Policy providers charge high premiums to people with low credit rating because they have higher risk. A person working in a good working environment pays low premiums. Insurance go up if an individual works in a dangerous working environment. Therefore it is important for an individual to evaluate the factors that increase premium rates when applying for insurance policy.
